On Tuesday June 24, 2014, the see saw destruction of fiat wealth got strongly underway, as Equity Investments, VT, Global Financials, IXG, Nation Investment, EFA, Small Cap Nation Investment, and Yield Bearing Investments, joined Credit Investments, AGG, in trading lower; this coming on the failure of the European Financials, EUFN, and Nation Investment in Ireland, EIRL, Greece, GREK, and Austria, EWO.
The loose monetary policies of the world central banks have finally stirred up inflation and have finally resulted in turning investment sentiment from greed to fear, specifically fear that the world central banks' monetary policies have crossed the rubicon of sound monetary policy, and have "money good" investments bad
Gold Miners, GDX, GDXJ, Silver Mines, SIL, SILJ, Energy Production, XOP, Global Integrated Energy, IPW, FILL, Energy Service, OIH, IEZ, Solar Energy, TAN, Consumer Staples, KXI, Consumer Discretionary, RXI, Consumer Services, IYC, Timber Producers, WOOD, Automobiles, CARZ, Design Build, FLM, Aerospace and Defense, PPA, Semiconductors, SOXX, Global Industrial Producers, FXR, Metal Manufacturers, XME, Transportation, XTN, Coal Miners, KOL, and Copper Miners, COPX, led World Small Cap Stocks, VSS, and World Stocks, VT, lower, with the result that the world entered into the final phase of the Business Cycle, that is Kondratieff Winter, providing the perfect short selling opportunity of selling from an equity market top, more specifically an Elliott Wave 5 High.
Of note the famed Berkshire Hathaway, BRK-A, is a failed investment as is seen in its ongoing Yahoo Finance Chart, when compared to Insurance Companies, KIE, Dividend Payers, DTN, and Financials, RWW.
Ireland's Bank, IRE, Greece's Bank, NBG, Switzerland's Banks, UBS, CS, and the UK's Banks, RBS, LYG, BCS, and Germany's DB, led European Financials, EUFN, lower; Argentina's Banks, BMA, GGAL, BFR, traded lower; and Stockbrokers, IAI, Regional Banks, KRE, and Investment Bankers, KCE, traded lower, leading Global Financials, IXG, lower.
Gulf States, MES, Egypt, EGPT, Greece, GREK, Finland, EFNL, Austria, EWO, Spain, EWP, Portugal, PGAL, Italy, EWI, Argentina, ARGT, Emerging Africa, GAF, The UK, EWU, EWUS, Norway, NORW, Europe 50, FDD, Turkey, TUR. Thailand, THD, Canada, EWC, US Small Caps, IWM, IWC, New Zealand, ENZL, and Australia, EWA, KROO, led Nation Investment, EFA, lower.
Yield Bearing Investments, traded lower as Mortgage REITS, REM, and Residential REITS, REZ, traded lower, Industrial Office REITS, FNIO, traded lower, forcing Vanguard REITS, VNQ, lower.
Also, Eurozone Small Cap Dividend, DFE, Gulf Dividend, GULF, Australia Dividend, AUSE, Emerging Market Dividend, EDIV, Global Infrastructure, IGF, International Small Cap Dividend, DLS, Emerging Market Small Cap Dividend, DGS, Shipping, SEA, Smart Grid, GRID, Leveraged Buyouts, PSP, Water Resources, FIW, International Dividend Dogs, IDOG, Real Estate, IYR, Dividends Excluding Financials, DTN, traded lower.
Junk Bonds, JNK, traded to a new all time high, as Aggregate Credit, AGG, was led higher by the 30 Year US Government Bonds, EDV, the 10 Year US Notes, TLT, and the Long Duration Corporate Bonds, LWC, which forced the Interest Rate on the US Ten Year Note, ^TNX, lower to 2.59%.
Credit Bubble Stocks posts "High Yield" Coal Bonds. Coal has had some rough times because of competition from cheap natural gas the past few years. Some of the coal companies have had negative income and even operating profit for multiple years in a row. You'd think maybe there's be some distressed debt opportunities, but the bonds are extremely expensive.
Alpha Natural Resources - mines coal in VA, WV, KY (higher cost) in addition to WY. EBIT less than interest expense the past three years. Highest yielding bond 13%.
Armstrong Energy - Illinois basin coal (better), but operating income hasn't covered interest expense since 2009, yet bond only yields 8.7%.
Peabody (NYSE:BTU) - good coal but highest yielding bond less than 7%.
CLD - Powder River Basin (good coal), but highest yielding bond only 5.6%. Is profitable and covering interest expense though.
Consol - highest yielding debt 5.5%.
Westmoreland - yielding about 5%
This is probably the type of debt that yield hunger funds have shorted the long bond to buy.
An inquiring mind asks will inverse bond ETFs such as SAGG, HYND, and AGND, preserve one's wealth, which can seen in their ongoing combined Yahoo Finance Chart?
Perhaps, but they are dollar based fiat wealth, and will not participate in the increase in wealth that comes from the demand for safe haven hard assets, such as the physical possession of gold bullion, GLD.
Soon the US Dollar, $USD, UUP, will buckle and trade lower with the rest of the World Major Currencies, DBV, as well as the Emerging Market Currencies, CEW, which will invigorate the investment demand for Gold, GLD, whose price will rise from its current range of $1,240 to $1,320.
Gold is in the middle of an Elliott Wave 3 Up, and as such only God knows how high it will go
Wealth can only be preserved by investing in and taking physical possession of gold bullion.
Doug Noland described money manager capitalism as being characterized by wildcat finance, where bankers waived magic wands of credit creation. The new normal economic experience of regionalism will be one of wildcat governance where regional fascist leaders warn with clubs of debt servitude.
Disinvestment out of debt trade investments such as Coal Mining Stocks, KOL, such as ANR, Rental Landlord, Blackstone, BX, Wireless Provider, S, Rental and Leasing Companies, HEES, URI, Rubber and Tire Manufacturer, GT, which had underwritten the most risky of debt, and deleveraging out of currency carry trade investments, such as the European Financials, EUFN, the European Small Cap Dividends, DFE, Gulf Dividends, GULF, Emerging Market Dividend, EMIF, Shipping, SEA, and Water Investments, FIW, brought Pursuit of Yield Investing to an end on June 24, 2014, and in so doing terminated the Banker Regime's power of Global ZIRP, which has been largely responsible for the dynamos of creditism, corporatism, and globalism, which served to create the investor as the centerpiece of economic activity.
Tuesday, June 24, 2014, marked an inflection point in economic history. as the world pivoted from the age of currencies and credit, and into te age of diktat and debt servitude, on the trade lower in the European Financials, EUFN, and the trade lower in Ireland, EIRL, and Greece, GREK.
The age of investment choice is over and the age of debt servitude has commenced.
Despite the Credit Bubble Stocks report Treasury Implied Volatility Very Low $TLT. The Creature from Jekyll Island was struck a deadly blow by the bond vigilantes, who tenaciously have yielded the Bow of Economic Sovereignty, that is the Interest Rate on the US Ten Year Note, ^TNX, calling it higher from 2.49%, and sustaining it at 2.59%, which destroyed Credit Investments, that is Aggregate Credit, AGG, beginning June 2, 2014.
Debt deflation is underway, and it has led to the Euro, FXE, the British Pound Sterling, FXB, and now the Australian Dollar, FXA, trading lower in value. Soon, debt deflation will commence in Emerging Market Currencies, CEW, turning the Emerging Markets, EEM, and the Frontier Markets, EMFM, FTR, lower, making the Bloomberg report Norway's $880 Billion Wealth Fund to Target Frontier Markets, a most unfortunate thing.
Look for Hedged Equity ETFs, HEDJ, and DBEM, to consistently trade lower.
Out of the failure of credit and the death of currencies, the Beast Regime, will rise to power, as the singular dynamo of Regionalism, powers up, as leaders meet in summits to renounce national sovereignty, and to announce regional pooled sovereignty for regional security, stability and sustainability.
Regional fascist leaders will announce diktat policies of regional economic governance and schemes of totalitarian collectivism which will develop the debt serf as the centerpiece of economic activity